Dart Energy to buy£42m Of UK’s Gas Assets

By Cynthia Taylor

The Australian coal-seam gas company, Dart Energy, has entered an agreement to buy the unconventional gas assets of Greenpark Energy for the sum of £42 million; the news was released on the Australian Securities Exchange.

Payment for the Greenpark’s 22 on-shore licenses will be done using two tranches, these will comprise a mix of shares and cash, and will be either in Dart Energy itself or in a company that is still to be listed called Dart Energy International.

Greenpark holds a one hundred percent working interest in almost all of the licenses and is also the operator of them all, through this deal, Dart will have secured the exclusive options on interests in the licenses for shale plays and CBM in Spain and Poland.

Nick Davies, Executive Chairman of Dart says that this agreement of acquiring the unconventional gas assets of Greenpark in the UK and Europe is a ‘significant step’ towards realizing the European aspirations of Dart Energy.

This announcement of the Greenpart acquisition has come less than a week after the BG Group and Dart Energy agreed to a restructure of their existing business arrangement in Europe, this gives the gas giant, Dart Energy, a 50% stake in fourteen of the on-shore license areas that are in the UK, which takes Dart’s holdings to 100% in the acreages.

Part of this deal means that Dart will assume the obligations that remain to drill 11 Wells in the coal-seam of gas licenses before June 2014. BG and Dart has also agreed on the terms for future potential sale to BG of gas that is developed at the license areas in the UK. The agreement could possibly lead to sales of gas up to 3.7Bcf/annually over a 7 year term at the market prices.

Together with previous agreed sales to Scottish and Southern Energy (SSE), the sales potential to BG could realize possible revenue to Dart of about $700 million over the following eight years.

Dart, last week, paid $4 million for the option of increasing its equity in Fortune Liulin Gas (FLG)of China from 45% up to 50%.

FLG holds and operates 50 Liulin coal-seam gas project of in China. The projects other partner is the state-owned, China United Coal Bed Methane.

The balance of FLG is held by the UK listed company, Fortune Oil, which has extensive midstream and upstream oil and gas operation in China. Dart will be able to increase its shares in FLG up to 75% by 30th June, 2013. Liuoin in China is one of the advanced coal-seam gas projects. It maintains 86 Bcf of probable and possible proven and certified reserves, and has received the designation as the states special ‘pilot project’ by the Chinese authorities.

Dart has a global activity of three substantial operational areas, and each area has significant acreages as well as near-term potential production.

Dart is the holder of 7 CBM assets in New South Wales, in Australia, it also holds 8 CBM assets in China, India and Indonesia, and in the European arena, it now holds 41 assets, with CBM business in UK and Europe. The European holdings include substantial potential shale gas acreage, as well as the options of 5 additional licenses which Dart will consider over the coming months.

The uniqueness of Australia’s coal-seam gas companies, Dart stands out because its primary focus is on international projects, these projects can be developed quickly and incrementally in order to service established gas markets. The company has plans of spinning off a minority share in its Singapore stock international business.